Lower GST rates to boost hospitality, transport and cultural sectors

New Delhi, Sep 22 (IANS) The revamped GST rates, implemented from Monday, will make the country’s tourism sector more affordable, enhance public transport use, and support artisans and cultural industries, the government said.

Early this month, the GST Council reduced the GST on hotels (less than Rs 7,500/day) -- from 12 per cent to 5 per cent (without ITC). GST on buses with a seating capacity of over 10 persons was brought down to 18 per cent from 28 per cent. Similarly, the GST on art and cultural goods was also reduced from 12 per cent to 5 per cent.

“The reductions will strengthen the domestic tourism ecosystem, promote cultural heritage, and encourage investment in related sectors,” an official statement said.

“Under the leadership of PM Modi, these reforms align with the vision of sustainable and inclusive growth, fostering job creation and investment in hospitality, transport, and traditional crafts, while also accelerating the post-pandemic recovery of India’s tourism sector,” it added.

The lower GST rates on hotels are expected to make hotel stays more affordable for middle-class and budget travellers. It also aligns with India’s hospitality tax structure with international tourism destinations, becoming more attractive for foreign tourists.

The move is also expected to boost weekend travel, pilgrimage circuits, heritage tourism, and eco-tourism as well as encourage investment in new mid-segment hotels, homestays, and guesthouses, creating jobs and improving infrastructure.

The revamped GST on buses cuts the upfront cost of buses and minibuses, making them more accessible for fleet operators, schools, corporates, tour providers, and state transport undertakings.

It will help bring down ticket fares, especially in semi-urban and rural routes, and encourage a shift from private vehicles to shared/public transport, reducing congestion and pollution.

It will also support fleet expansion and modernisation, improving comfort and safety standards in public transport.

Further, the GST reduction on art and cultural goods, which applies to statues, statuettes, original engravings, prints, lithographs, ornamental articles, stone art ware, and stone inlay work, will provide direct support to artisans, craftsmen, and sculptors.

The move will also help preserve living traditions of temple art, folk expression, miniature painting, printmaking, and stone craftsmanship, and promote Indian culture and craftsmanship globally, integrating heritage economy with modern markets, the government said.

“These GST reductions reflect a strategic effort by the government to boost India’s tourism and cultural sectors by enhancing affordability, supporting traditional artisans, and encouraging sustainable transport,” the official statement said.

"By fostering greater accessibility and preserving cultural heritage, these measures are poised to generate significant economic growth, create jobs, and promote India’s image globally as a vibrant and inclusive destination," it added.

--IANS

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